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    Sunday, May 27, 2018

    Ripple Daily Ripple/XRP Discussion Thread 05/27/18 [Questions and Price Predictions]

    Ripple Daily Ripple/XRP Discussion Thread 05/27/18 [Questions and Price Predictions]


    Daily Ripple/XRP Discussion Thread 05/27/18 [Questions and Price Predictions]

    Posted: 27 May 2018 01:13 AM PDT

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    NPV vs. Network Nodes (XRP Valuation/Projection)

    Posted: 27 May 2018 11:10 AM PDT

    A recent talk by Brad Garlinghouse at Money 20/20 illuminated a very interesting point about the value of a network (any network of participants, not just technological ones). Essentially the value of a network is roughly proportional to the square of the nodes participating in that network

    V = k*N^2, where the proportionality constant k is representative of all the qualitative factors not easily captured and is assumed to be the sum total of all of the linear multiplicative factors inherent in the technology, for which there is no change unless new technology is introduced.

    The reason for this intrinsic value is that it is derived essentially from the functional utility created by mutual consensus to use the same network to transact business, it is not derived from some magical intrinsic property. For a global remittance/transfer network like RippleNet, there are roughly 100+ existing nodes. For the moment let's dismiss the Dec.2017 run-up as a retail speculative pump, and one that is not really representative of the RippleNet nodal network. Instead let's assume for simplicity that the intrinsic value is $1.000 USD/XRP.

    Using the above formula, V = $1.000, so N^2 = 100^2 or 10,000. This makes k = 0.0001. Using a simple extrapolation we can speculate on an intrinsic value of the network at a 200 nodes, 300 nodes, etc., with assumptions on the growth of the nodal participation rate.

    At 200 nodes, using the above formulation, the XRP value would be $4.00/XRP, at 300 nodes the XRP token would be around $9.00. Now, they recently stated they've been signing about 1 bank per week on average (and I suspect this will accelerate with FOMO by bank competitors, but for the sake of argument lets assume this stays the same).

    In 2018 we have roughly 28 weeks left in the year, which should bring the bank total to ~200 by year end. I think it would be reasonable to expect an XRP value of $4.00 by year end solely on nodal network value. This does not include escrow or XRP burn rates, nor does it rely on the NPV assumptions on utilization and INSTO demand, as so eloquently presented by Esoteric Trading in her most awesome video blog.

    Bottom line, we could easily see a $9 - $10 valuation by year end of 2019 on nodal network value alone (with nothing else!) and still be within the estimations of the square law. Present XRP price is depressed at a BTC coupled price of $0.65 on the moving average, so we could see multiples of 8x by year end.

    I thought it important to share a Net Present Value (NPV) assessment made in a YouTube video by Suzie Crew of Esoteric Trading Solutions. It's a long video but well worth every word and I encourage you to view it for yourself to understand what we could be dealing with here once the Institutional Investors enter the crypto space en mass. It's on YouTube under the title "XRP valuation $334.47USD per 1 XRP". The main formulation is summarized below:

    The NPV formulation essentially takes the following form: NPV = -1 mil + (Market Share in USD-Yr.1)/1 + (% Rate Yr. 1) + (Market Share in USD-Yr.1)/1 + (% Rate Yr. 2)....

    In this analysis the following assumptions are made:

    1. Ripple captures 10% of the target market (global transfer handling) using XRapid/XCurrent (conservative given FOMO and competitive client pressures).

    2. The 10% market share is approximately equivalent to $12.49 Trillion USD equivalent (assuming present day bank cash flows used in transfers) in Yr.1, $33 Trillion in Yr.2, etc..

    3. The XRP in circulation at the time of the NPV determination is ~100 Billion (conservative as no escrow/burn assumed).

    4. The 1 Yr. Discounted Cash Flow vs. yield/credit curves are derived from a credit rating of AA (swap rate curve).

    5. No holding by exchanges or clearinghouses as the value of XRP rises is assumed (which is conservative as there would undoubtedly be pressure to hold as prices rise, and therefore supply of a given coin is limited).

    The results of this analysis are as follows:

    1. $125 USD / XRP Yr.1

    2. $335 USD/ XRP Yr. 2

    3. $892 USD/ XRP Yr. 3

    I think this shows the exponential rise we are hoping for (which derives from technology and network adoption, not speculation and not just nodal network consensus).

    I chose not to use this NPV determination because I didn't want to make any assumptions about product utilization, I was simply trying to create a base value for the network, not the Ripple enterprise product. I like the NPV method because at it's core is the principle of supply/demand and reflects the psychology of holding and using XRP in a situation in which there is large participant consensus. It's very fascinating.

    Either way, the bottom line is that there is a dedicated team of people with a vested interest in increasing both the network traffic of RippleNet (intrinsic consensus value) as well as trying to increase the XRP utilization and cash flows that pass through the Ripple platform.

    Both approaches look very favorable no matter which way you slice it!!! HODLXRP

    submitted by /u/Santiago_Velez
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    Google worldwide trends for the past 90 days: Japan is the only country where the term XRP was more searched for than the term Ripple.

    Posted: 27 May 2018 02:53 AM PDT

    Emi Yoshikawa, director at Ripple: "This year is the year for commercialization"

    Posted: 27 May 2018 05:06 AM PDT

    Kuwait Finance House Joins RippleNet For Improved Cross-Border Transactions

    Posted: 27 May 2018 02:46 PM PDT

    Can anyone explain how the BitLicense (BL) has helped Ripple Labs work w/ NY based banks? Are NY banks actually working w/ Ripple (buying XRP) based on this NY specific regulation passed in 2016? How does Ben Lawsky (BL creator) fit in as Board Director? Did he help get more NY banks onboard?

    Posted: 27 May 2018 06:20 PM PDT

    Uphold to Nano S

    Posted: 27 May 2018 03:42 PM PDT

    I have been searching around and it looks like I can't send my Xrp to my nano S. After reading that Uphold had full support for XRP I assumed that external transfer. I also read a few comments here that it could be done. Looks like I was a bit overzealous after buying my xrp it looks like I can't transfer to my nano. Bummer I like holding my xrp in my own hands.

    submitted by /u/Raiderflow
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    USA CONGRESS, THE 2018 JOINT ECONOMIC REPORT , Crypto chapter 9

    Posted: 27 May 2018 12:51 AM PDT

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